You’ll likely have heard the news by now that education technology company 2U is acquiring online course provider edX (not to be confused with Open edX, which will remain an independent learning platform). There is always a lot of uncertainty surrounding acquisitions and how they’ll play out for people and companies who use the underlying technology.
Our customers have been asking us what this transaction means for them and how it will affect the way we at Appsembler operate given that our underlying technology is based on Open edX, the same technology that edX uses to deliver its course offerings.
Overall, the transaction will have a positive impact on Open edX, which was originally founded in 2012 with $80-$100 million from Harvard and MIT, and we wanted to give our take on what this means for Appsembler and our customers.
Details of the Acquisition
If regulators approve the transaction, 2U will pay $800 million in cash for edX’s assets, which will include the edX brand, website, and marketplace. If approved, edX expects the transaction to close within 4 months. 2U and edX’s Board of Directors and the boards of MIT and Harvard have all already approved the deal. This acquisition is not subject to any shareholder approval or financing contingencies.
edX will be reorganized as a public benefit company—a purpose-driven organization that balances the interests of shareholders with other stakeholders (like Open edX’s partners and users)—under the 2U umbrella, while the proceeds of this acquisition will be transferred into a nonprofit. This nonprofit, led by Harvard and MIT, will use the proceeds to explore the next generation of online education and focus on overcoming the persistent inequities in online learning.
As a result of the acquisition, the combination of 2U and edX will reach over 50 million learners, 1,200 enterprise customers globally, serve more than 230 universities and corporate partners, and offer more than 3,500 digital programs. 2U’s network will now include 19 of the top 20 universities in the world and more than 185 nonprofit colleges and universities, creating the world’s most comprehensive free-to-degree online education marketplace.
For additional details on the acquisition, read MIT News’ article here.
What Is the Difference Between edX and Open edX?
A common misconception is that edX and Open edX are the same and the words can be used interchangeably. This isn’t the case.
edX is an organization that provides free online courses to individuals, businesses, and educators whereas Open edX is the underlying software and technology powering edX. Open edX is a free, open source learning management system that companies and organizations use to host their own branded, personalized, and tailored online universities — whereas edX is an example of an online university built using Open edX. The 2U transaction is for edX and not the underlying Open edX technology, which will continue to remain independent and open-source.
What Does This Transaction Mean for Open edX, Appsembler, and Our Customers?
Appsembler Tahoe is built on Open edX and we are proud participants and contributors to the Open edX community. This acquisition will help the Open edX technology platform to grow, and provides the market’s validation on Open edX’s commercial value and technological innovation.
As part of the acquisition, 2U has committed to the continuation of edX’s mission, which includes contributing to the ongoing technological development and innovation of Open edX. This will allow Open edX to continue advancing its innovative roadmap while creating value for its partners and users. 2U’s commitment will not only continually improve Open edX, but also ensure the platform remains open source, allowing its dedicated community of users to thrive.
This acquisition also provides the financial resources for edX to compete against other free online universities, and Open edX to continue innovating its market-leading learning management system. It’s the best of both worlds and as MIT President L. Rafael Reif wrote in a letter to the MIT community regarding the acquisition, they have found, “a future for edX as a public benefit company that will pair the resources of a for-profit player with a formal mission to serve the public good.”
In his letter, Reif also noted, “Equipped with these significant new resources, the nonprofit will have the power to … invest at the necessary scale to sustain Open edX as a fresh, vital, open source learning platform for the world, and help tackle the next great research challenges in online learning.”
We’re excited to see what the future holds for Open edX, and we are confident that the platform will only continue to get better with the support of 2U, the creation of this new nonprofit, and the continued participation of Open edX’s highly engaged open source community.
Appsembler and its customers
The announced transaction is a strong endorsement to Open edX’s merits as the technological foundation to online training programs, while the $800 million capital infusion (earmarked to explore the next generation of Open edX) is expected to usher in another influx of innovation, product features, and updates to Open edX. And as those upgrades make their way into the Open edX codebase, we will continue incorporating them into Appsembler’s product roadmap for all of our customers to take advantage of.
For Appsembler’s customers, it’s business as usual, and your relationship with Appsembler is not directly affected by the transaction. Appsembler will continue acting as your Open edX service provider and if you have any questions or concerns, please contact us.